Health Care Deal News: Spotlight on Medical Devices

Being profitable doesn’t make a division all that valuable, it appears. In the wake of its $3.72 billion acquisition of Gen-Probe (NASDAQ: GPRO) last year, Hologic, Inc. (NASDAQ: HOLX) began cleaning house in order to pay its debts. One result: Immucor, Inc. agreed to buy its Lifecodes unit for $85 million. The deal includes cash up front and an additional $10 million in revenue milestones. Immucor makes and sells reagents and automated systems for use in hospitals, clinical laboratories and blood banks. Its expected annual revenue is approximately $334.4 million, EBITDA of $100.7 million and net loss of $42 million. Lifecodes makes molecular and antibody-based assays for transplants and transfusion. Now Immucor can offer customers a single source for transplant and transfusion testing.

Another strategic move in the medical device sector came from Analogic Corporation (NASDAQ: ALOG), which purchased privately held Ultrasonix Medical Corporation for $83 million in cash, funded with cash on hand. The Vancouver, British Columbia-based company does just what its name implies, supplying advanced ultrasound systems for point-of-care and general imaging applications through more than 5,000 systems installed worldwide. Analogic designs, manufactures and sells high-precision data acquisition, and signal and image-based medical and security systems. On a trailing 12-month basis, Analogic generated revenue of $518 million, EBITDA of $58 million and net income of $43 million. The transaction is expected to close in late February 2013 and it will be neutral to EPS in fiscal year 2013 but turn accretive in 2014.

More medical device companies teamed up. GSI Group Inc. (NASDAQ: GSIG), a leading supplier of laser-based products, precision motion and optical technologies, announced the acquisition of NDS Surgical Imaging, maker of surgical and radiology displays and related peripherals. The purchase price of $82.5 million was financed using approximately $25 million of cash-on-hand with the remainder from the company’s new credit facility. The acquisition closed on January 15, 2013 and is accretive to earnings, expected to add more than $80 million in revenue and nearly $12 million of adjusted EBITDA to GSI’s 2013 financial results............Want to read more? Click here for a free trial to The Health Care M&A Information Source and download the current issue today